The US dollar and gold are supported by Trump's tariffs

The US dollar

The US dollar rose for the third day in a row to 108.40 levels, after President Trump unveiled plans to impose 25% tariffs on all steel and aluminum imports to the United States, raising concerns that the increased tariffs could lead to increased inflation and limit the Fed's ability to reduce interest rates.

The dollar also received support from the US payroll report released last Friday, which showed that the unemployment rate in January fell to an 8-month low and average hourly earnings in January rose more than expected, which are aggravating factors for the Fed's policy.

Markets exclude the likelihood of a 25 basis point interest rate cut at the next FOMC meeting on March 18-19.

Euro-dollar

The eurodollar pair fell after this announcement from President Trump to impose 25% tariffs on all steel and aluminum imports to the United States, which may disrupt World Trade and burden the eurozone economy, and the dovish comments from ECB President Lagarde on Monday affected the euro when she said that the process of deflation of inflation in the eurozone is on the right track.

Also ECB Vice President jindus warned that the implementation of tariffs by the United States would create a supply shock, which would mainly affect the global economic expansion.

Market pricing on the prospect of a 25 basis point interest rate cut by the European Central Bank at its monetary policy meeting on March 6 rose to 100% from 97% last week.

Gold

As for gold, the growing demand for Safe Haven has pushed precious metal prices to rise after President Trump announced the imposition of tariffs on US steel and aluminum imports, and the potential increase in demand for gold from China is boosting gold prices after China announced a pilot program to allow insurance companies to invest up to 1% of their assets in bullion, which may translate into a potential purchase of gold worth 200 billion yuan, equivalent to 27.4 billion dollars.